Quasi-Engel Curves, Diffusion, and the Ownership of Major Consumer Durables

Abstract

When a new durable is introduced, the fraction of owners in the population increases. A growth curve is observed, which is a logistic in some cases, but skewed in others. The logistic is usually taken as evidence for "epidemic diffusion." Empirical analysis of a series of subsequent cross sections reveals, however, that logistic growth curves result when no diffusion whatsoever occurs, that is, when growth is fully income induced. Skewness of growth curves, as observed during the spread of television ownership, is likely to appear when there is "learning," or when the good is transformed from a luxury into a necessity.